The Terra Classic community is witnessing critical decision-making moments as LUNC developers re-enable Inter Blockchain Communication (IBC) with Cosmos blockchains. Meanwhile, the community remains divided on whether to increase the burn tax parameter from 0.2% to 1.2% during the reopening of the IBC and whether to merge LUNC with LUNA.
Terra Community votes on crucial developments
Terra Rebels core developer Edward Kim’s proposal 10950 to re-enable three IBC channels for Cosmos-based chains Osmosis, Crescent and Juno has already reached the “pass threshold” with 100% support. In addition, Edward Kim noted that the community could expect a significant increase in the number of projects built on the network after the v23 upgrade with the CosmWasm upgrade.
With the developers reopening the IBC channels on block 10,542,500 estimated on December 5, proposal 10960 aims to increase the combustion tax to 1.2%, with 0.96% tax as on-chain combustion allowance and allocation of 0.24% to the common pool.
The proposal aims to take advantage of the increased volume of osmosis and compensate for the slow combustion rate after the implementation of 0.2% combustion tax. Furthermore, the 2nd part of the proposal proposes to split the 1.2% burn tax to regulate the burn rate, the community pool fee, the Oracle rewards pool fee and the USTC repeg pool fee.
While the proposal was somehow adopted by the community, it was met with resistance from developers and popular validators who believed it would only hurt the chain. Validator ClassyCrypto in one tweet revealed that he voted “No” on the proposal, as raising the burn tax will affect efforts to return projects to the chain.
Meanwhile, others believe that 0.2% has reduced the combustion rate and that the combustion load parameter should be changed again to 1.2%.
The division could be seen over whether LUNC should merge with LUNA to increase utility and bring the projects back to the chain. Most assume that the Terra Classic community will never merge with LUNA, as the Terra Rebels’ Revival Roadmap indicates a goal to become independent from LUNA and Do Kwon.
Will the Divide Plunge LUNC Price?
Experts argue that the price of Terra Classic will drop more if the community remains divided over major proposals. With December being a key month for the community due to various initiatives, the gap could affect LUNC price.
The LUNC price plummeted nearly 4% in the past 24 hours, with the current price trading at $0.000156. The 24-hour low and high for LUNC are $0.000153 and $0.000166, respectively.
The community burned 28.657 billion LUNC tokens and deployed 900 billion LUNC tokens.
Also Read: Binance Terra Classic (LUNC) Monthly Burn Mechanism
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This post Terra Classic Community splits on 1.2% Burn Tax, LUNA Fusion
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